Guest bmurphy Posted March 12, 2004 Posted March 12, 2004 What are the tax/penalty ramifications if someone takes funds out of an IRA where a 72t distribution is currently in place? Custodian said they wouldn't stop client from doing so but I wanted to make client aware of tax implications.
Guest Derelict Posted March 12, 2004 Posted March 12, 2004 The SEPP would be 'busted'. All previous distributions in the series of payments would now be subject to the 10% penalty...
Mary Kay Foss Posted March 13, 2004 Posted March 13, 2004 In addition to the 10% penalty, there is interest on those penalties back to the original one. Mary Kay Foss CPA
ElGuapo Posted March 19, 2004 Posted March 19, 2004 Of course the client can eventually get out of the SEPP w/o penalty, just have to keep it up till they are 59 1/2 AND have done SEPP for five years.
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